On 21 May 2021, the International Trade Administration Commission of South Africa (ITAC) announced the proposed amendment and creation of Rebate facilities under the Rebate Items in Schedule No.3 to the Customs and Excise Act, 1964 on which comment is due by 22 June 2021.
The amendments relate to:
Rebate Item 311.42/5212.1 “Other woven fabrics of cotton, of a mass not exceeding 200g/m2, in rolls of width of 200cm or more, classifiable in tariff subheading 5212.1 in such quantities, at such times and subject to such conditions as the International Trade Administration Commission may allow by specific permit for the manufacture of goods classifiable in tariff heading 63.02, 63.03, 63.04 and 94.04”
Rebate Item 311.42/5212.2 “Other woven fabrics of cotton, of a mass not exceeding 200g/m2, in rolls of width of 200cm or more, classifiable in tariff subheading 5212.2 in such quantities, at such times and subject to such conditions as the International Trade Administration Commission may allow by specific permit for the manufacture of goods classifiable in tariff heading 63.02, 63.03, 63.04 and 94.04”
Rebate Item 311.42/53.09 “Woven fabrics of flax, in rolls of a width of 200mm or more, classifiable in tariff heading 53.09, in such quantities, at such times and subject to such conditions as the International Trade Administration Commission may allow by specific permit, for the manufacture of goods classifiable in tariff headings 63.02,63.03, 63.04 and 94.04”
REBATE Item 311.42/5512.1 “Woven fabric of synthetic staple fibres, containing 85 per cent or more by mass of polyester fibres, in rolls of a width of 200cm or more, classifiable in tariff subheading 5512.1 in such quantities, at such times and subject to such conditions as the International Trade Administration Commission may allow by specific permit, for the manufacture of goods classifiable under tariff headings 63.02, 63.03, 63.04 and 94.04”
Rebate Item 311.42/55.16 “Woven fabrics of artificial staple fibres, in rolls of a width of 200cm or more, classifiable in tariff heading 55.16, in such quantities, at such times and subject to such conditions as the International Trade Administration Commission may allow by specific permit, for the manufacture of goods classifiable in tariff heading 63.02, 63.03,63.04 and 94.04”
Rebate Item 311.42/5903.10.90 “Textile fabrics impregnated, coated, covered or laminated with polyvinyl chloride, other in rolls of a width of 200cm or more, classifiable in tariff subheading 5903.10.90, in such quantities, at such times and subject to conditions as the International Trade Administration Commission may allow by specific permit, for the manufacture of goods classifiable in tariff heading 63.02, 63.03, 63.04 and 94.04”
Rebate Item 311.42/5903.90.90 “Other textile fabrics impregnated, coated, covered or laminated with plastics, other, in rolls of width of 200cm or more, classified in tariff subheading 5903.90.90, in such quantities, at such times and subject to such conditions as the International Trade Administration Commission may allow by specific permit, for the manufacture of goods classifiable in tariff headings 63.02, 63.03, 63.04 and 94.04”
AMENDMENT OF THE BELOW-MENTIONED REBATE ITEMS
Rebate Item 311.42/55.13 “Woven fabrics of synthetic fibres, containing less than 85 per cent by mass of such fibres, mixed mainly or solely with cotton, of a mass not exceeding 170 g/m², in rolls of a width of 200 cm or more, in such quantities, at such times and subject to such conditions as the International Trade Administration Commission may allow by specific permit, for the manufacture of goods classifiable in tariff headings 63.02, 63.03 and 63.04, by the deletion of rebate item.”
Rebate Item 311.42/55.13/01.04 and the creation of a new rebate item for ‘Woven fabrics of synthetic fibres, containing less than 85 per cent by mass of such fibres, mixed mainly or solely with cotton, of a mass not exceeding 170 g/m², in rolls of a width of 200 cm or more, in such quantities, at such times and subject to such conditions as the International Trade Administration Commission may allow by specific permit, for the manufacture of goods classifiable in tariff headings 63.02, 63.03, 63.04 and 94.04’
Rebate Item 311.42/55.14 “Woven fabrics of synthetic staple fibres, containing less than 85 per cent by mass of such fibres, mixed mainly or solely with cotton, of a mass exceeding 170 g/m², dyed or printed, in rolls of a width of 200 cm or more, in such quantities, at such times and subject to such conditions as the International Trade Administration Commission may allow by specific permit, for the manufacture of goods classifiable in tariff headings 63.02, 63.03 and 63.04” by the deletion of Rebate Item 311.42/55.14/01.04 and the creation of a new rebate item for “Woven fabrics of synthetic staple fibres, containing less than 85 per cent by mass of such fibres, mixed mainly or solely with cotton, of a mass exceeding 170 g/m², dyed or printed, in rolls of a width of 200 cm or more, in such quantities, at such times and subject to such conditions as the International Trade Administration Commission may allow by specific permit, for the manufacture of goods classifiable in tariff headings 63.02, 63.03, 63.04 and
94.04.”
Rebate Item 311.42/5903.20.90 “Textile fabrics impregnated, coated, covered or laminated with polyurethane, in rolls of a width of 200 cm or more, classifiable in tariff subheading 5903.20 in such quantities, at such times and subject to such conditions as the International Trade Administration Commission may allow by specific permit, for the manufacture of mattress covers classifiable in tariff heading 63.02” by the deletion of Rebate Item 311.42/5903.20/01.08 and the creation of a new rebate item with the same description mentioned above.
The application by Sheraton Textiles Holdings (Pty) Ltd reasoned that:
(a) Home textile finished goods may be imported into South Africa subject to a duty of 30% (20% in the case of filled products), whilst the fabric incurs a duty of 22%. This gap is insufficient to allow local home textile manufacturers to compete with manufacturers of these products from countries in the East.
(b) All major home textile manufacturing countries (China, India and Pakistan) give significant export incentives to their manufacturers (In the case of China, these are as high as 20%), which means in many cases that the fully duty paid, end products can be landed in South Africa at a price almost equivalent to the duty-paid price of the fabric used to make the products.
(c) Further to this, the 22% duty applied to the fabrics was serving no purpose other than revenue generation, as the wide-width fabrics used by the home textile sector are not manufactured in South Africa. It should be noted that in respect of the current application, none of the fabrics are manufactured in South Africa.
(d) This rebate provision has been credited by the home textile sector and its retail customers as the largest single positive factor in ensuring that, over the past 10 years of its existence, the level of localisation has increased significantly. It has resulted not only in the prevention of job losses, but even more encouragingly, and in contrast to the rest of the textile sector, in creating new ones.
(e) The Applicant further indicated that they seek to update the list of fabrics covered by the rebate to cover new products that have emerged since the inception of the 311.42 rebate as well as allowing for the broadening of the rebate to include black-out curtaining (from coated fabrics) and in so doing ensure that local home textile manufacturers are able to meet the needs of their retail customers, hospitality, and institutions, and in the process create jobs needed to make these products.
The tariff application is accessible at:
https://www.gov.za/sites/default/files/gcis_document/202105/44593gen302.pdf
Story by: Riaan de Lange